So you think you are ready to buy a house. Here are the questions you need to answer: do you have an emergency fund? If you do not, you might not be that ready than you think. Here are reasons why having an emergency fund is a prerequisite to buying a house.
Consider these reasons before you apply for home loans in Utah from institutions such as Altius Mortgage Group.
Buying a home is a long-term financial commitment
Once you get a mortgage loan, the monthly payments will not stop until you have paid it off. This means that whatever you will earn from here on will go straight to loan payments. You will not have the luxury of saving some money for emergencies.
It helps you carry on in the case of job loss
Most people time their home-buying plans when they get a raise in their salaries or when they have a new means of income. But what happens if you suddenly lose your job? Where will you get the money to cover your daily expenses and stay afloat while you get a new job?
This is where the emergency fund comes in. In fact, it is advisable to create an emergency mortgage fund or pay more in advance to help you during these rainy days.
Safety net for emergency medical expenses
Medical expenses count for one of the top reasons why some people file for bankruptcies. The scary thing about this is that you will never know when you face a medical emergency.
Having saved money for such emergency allow you to get some peace of mind that you have some money saved to cover for medical expenses that will come out from your own pockets. Sometimes, even if you have healthcare coverage, it could take some time before you get the reimbursements.
Just because you are not ready yet does not mean you will never be. It is a tough pill to swallow but many people do not have emergency funds saved. So work on building this first before you embrace a long-term financial commitment such as mortgage loans.